How the math works
IV method: Expected Move ≈ Price × (IV/100) × √(DTE/365). This approximates one standard deviation for that expiration window.
Straddle method: The ATM straddle price is what the options market is charging for a move. Many traders treat that premium as a practical expected-move proxy for the session or expiration.
Important limits
- Expected move is probabilistic — price can exceed 1 SD
- IV is a snapshot; it changes through the day
- For intraday 0DTE, use fractional DTE (hours remaining ÷ 6.5)